Earnings Per Common Share

6 Months Ended

Jun. 30, 2022

Earnings per Common Share

LCNB has granted restricted stock awards with non-forfeitable dividend rights, which are considered participating securities. Accordingly, earnings per share is computed using the two-class method as required by ASC 260-10-45. Basic earnings per common share is calculated by dividing net income allocated to common shareholders by the weighted average number of common shares outstanding during the period, which excludes the participating securities. Diluted earnings per common share is adjusted for the dilutive effects of stock options, warrants, and restricted stock. The diluted average number of common shares outstanding has been increased for the assumed exercise of stock options and warrants with proceeds used to purchase treasury shares at the average market price for the period.

Earnings per share for the three and six months ended June 30, 2022 and 2021 were calculated as follows (dollars in thousands, except share and per share data):


	Three Months Ended June 30,			Six Months Ended June 30,
	2022		2021	2022	2021
Net income	$	5,618	5,290	10,141	10,530
Less allocation of earnings and dividends to participating securities	29		19	53	38
Net income allocated to common shareholders	$	5,589	5,271	10,088	10,492

Weighted average common shares outstanding, gross	11,396,119		12,789,684	11,635,949	12,815,089
Less average participating securities	58,314		45,958	59,076	45,958
Weighted average number of shares outstanding used in the calculation of basic earnings per common share	11,337,805		12,743,726	11,576,873	12,769,131
Add dilutive effect of:
Stock options	—		—	—	15
Adjusted weighted average number of shares outstanding used in the calculation of diluted earnings per common share	11,337,805		12,743,726	11,576,873	12,769,146

Earnings per common share:
Basic	$	0.49	0.41	0.87	0.82
Diluted	0.49		0.41	0.87	0.82